Thursday, October 30, 2008

The Virgin Mary Hodigitria

One of the objects on display at the Byzantium exhibition was a tapestry showing the procession of the Virgin Mary Hodigitria ("she who shows the way"). This was a painting of Mary made in her lifetime by St Luke which ended up in Constantinople. By the fourteenth century it was kept in a special tabernacle in the Monastery of the Hodigitria in Byzantium and was taken out and carried publicly in procession every Tuesday. It was destroyed by the Turks when they captured the city in 1453.

Wednesday, October 29, 2008

Byzantium

The Byzantium exhibition at the Royal Academy has some fascinating mosaics, jewellery, carved ivory and icons on display. The opulence of the Byzantine court is exemplified by the throne of Constantine VII Porphyrogenitos (born of the purple) 905-959. This was the so-called throne of Solomon beside which were golden lions and a bronze tree in which there were golden birds which sang different songs. Visitors would enter, prostrate themselves on the floor before the Emperor at which point the throne would rise high off the ground, the golden lions would roar and the golden birds sing. They were technologically advanced and it is believed that the idea of the throne came from the Islamic court in Baghdad. I do not know what happened to the throne but sadly it is not in the RA exhibition.

Tuesday, October 28, 2008

Crazy hedging

Today Volkswagen has become the world's largest company by stockmarket value after Porsche announced that it's raising its stake in it to 75% and short sellers are rushing to cover their positions, nearly doubling the share price in their mad dash and taking the market cap up to $367bn!

Monday, October 27, 2008

Agent Zigzag

I'm reading Ben Macintyre's excellent book, Agent Zigzag, about the British double agent, Eddy Chapman. He was originally recruited by the Abwehr and was trained near Nantes in radio transmitting, parachuting and explosives so that he could be sent to England as a spy for the Germans. Bletchley Park had picked up on Eddy's practice transmissions between Nantes and Paris, knew that his code name was Fritz, that he was probably English and that he was going to land in England at some point. His value to the Germans was highlighted to Bletchley when they cracked a radio transmission saying that Eddy had broken some teeth on a test parachute jump and that the Abwehr had paid 9500 francs for the dentistry bill. Chapman had befriended a pig at Nantes and trained it as his pet, calling him Bobby. Bobby would come running at the sound of Chapman's whistle. The pair would go walking and swimming together. Chapman would radio Paris about Bobby the pig. Bletchley was convinced Bobby was another agent!

Friday, October 24, 2008

Broker's joke of the day

Hong Kong market comment in 2010:

"We cut our 2011 and 2012 growth forecast for China to 0.3% and keep HK unemployment and inflation forecasts unchanged at 35% and 20% respectively. Our only analyst returns by bus from a China Life investor tour confirming premium growth targets will be met with the company engaging the People Liberation Army to sell its life policies at gun point in Xi'an and Beijing. Finally our quant team, now also processing tickets in operations, advises that Sun Hung Kai will come out of the Hang Seng Index this Friday and will be replaced by Shun Tak which has seen its market cap treble of late on reports that regulators will allow state banks to utilise tier 1 capital for low risk and well managed gambling investments in roulette, blackjack and baccarat in Macau."

Thursday, October 23, 2008

Poem of the day

Wednesday, October 22, 2008

Outsourcing

I have to have a small operation and was discussing it with the assistant doctor at Southampton Hospital. She said the surgeon would write to me with some possible dates. I asked when his letter would arrive. "It should be with you in ten days," she replied. "I dictate the minutes of our consultation today, then the report is sent to India to be typed and then it is sent back to the surgeon. After that, he'll write to you." She asked me not to ask why she can't simply e-mail him or speak to him directly, after all, they work in the same hospital.

Tuesday, October 21, 2008

Unemployment

The UK looks relatively strong at 3.6% and the lowest is the Ukraine at 2%. This makes me worried about the Euro, the possibility of social unrest and whether the Eurozone economy will be able to have a strong recovery in 2010.

Monday, October 20, 2008

East or West?

A Finn asked me whether I thought Poland was in Western or Eastern Europe. Never having been to Poland, I ventured, "West." "You are very PC!" he replied. "If you think Poland's west, you must think Finland's also west as some parts of Finland overlap with Poland." I wasn't at all sure about that. "No," I replied, "I'd say Finland's in Northern Europe." He was not at all amused about being asked about Iceland. "Iceland is two and a half times nearer the UK than Finland," he said, and poured himself another vodka.

Friday, October 17, 2008

Quotation of the day

Culinary flops

I invited some friends over for dinner the other day and thought I'd be well prepared so made the pudding the day before. I made a rectangular ginger sponge which I then rolled up in the form of a Swiss roll, with a pureed apple filling. There was rather too much filling so I spooned up the excess as it bulged out of the ends, covered the whole thing with cling film and left it overnight. When I came down in the morning to make the tea, I saw that the whole thing had collapsed. It was no longer a beautiful roll but rather a splurge of dark sponge with apple seeping out of it. An idea came to me: cover the whole thing with whipped cream and pieces of candied ginger. I did not reveal this disaster and to my amazement my friends marvelled when it was placed on the table.

Thursday, October 16, 2008

Vintage

Whilst enjoying a glass of 1993 Malmsey last night, I was reminded of the story of the Madeira which the Duke of Wellington had brought back from the Peninsula War. The 8th Duke thought it would be fun to open it in 1953 to celebrate the Coronation. The bottles were found in the depths of the cellar, dated 1797. He said it was a remarkably good vintage.

Wednesday, October 15, 2008

Religious landscapes

I met a travel memorabilia specialist who works at Sotheby's. He told be there's great demand for old photos and paintings of Mecca and Medina. Many of the old sites at these places have been destroyed by Wahhabists so they have changed dramatically. He sold six old photos of Medina for £1.2m recently. Arabs are buying their heritage. I don't suppose there are any paintings of the interior of Winchester Cathedral before Henry VIII or pre-Cromwell.

Tuesday, October 14, 2008

Deafening culture

In the turmoil of the markets I had forgotten that I nearly choked on my humbug when I heard that Andy Burnham is suggesting abandoning the ethos of "quiet contemplation" in public libraries and in its place allowing people to whoop with joy and engage in loud discourse about the nuggets of information which they have discovered there. His suggestion is more surprising as he read English at Fitzwilliam College, Cambridge. The University Library at Cambridge, apart from being possibly the ugliest building in the city, was, and probably still is, a great place to meet people: in its tea room. In the run up to my Finals, I used to go over there, spend a couple of hours pouring over Plato and then meet friends for tea at 4.30pm, the prospect of tea being the incentive to go there in the first place. I think it may be a good idea for public libraries to offer refreshments and the opportunity to converse with others, but not in the reading room. Havens of tranquillity are rare in this busy life and should be preserved at all costs.

Friday, October 10, 2008

Icelandic joke of the day

Local authorities across the UK were yesterday stunned to discover that Iceland is nothing more than a volcano surrounded by two million haddock. As the volcano's banks refused to pay out, councils said they were convinced Iceland was a small, landlocked country next to Belgium with a long history of expert financial management.But after 15 minutes on the internet they confirmed it was nothing more than a slab of stinking lava populated by a handful of wilfully eccentric musicians and half a dozen heavily bearded trawler captains.Julian Cook, director of finance at the Local Government Association, said: "I meant Luxembourg – sh*t!"I suppose the haddock-shaped piece of lava with every new account was probably a clue."Mr Cook is now demanding £1bn of taxpayers' money in compensation for losing £1bn of taxpayers' money.He added: "When the taxpayer is exposed in this way it is only right that central government should step in with its own funds, wherever they come from."But the Treasury has so far refused, criticising the councils for investing huge amounts of public money in badly run banks.

Hongres ou harengs rouges?

I was invited to lunch in the grandstand restaurant at Deauville racecourse and instructed that there would be a table for 10 reserved by the window. I was the first of our party to arrive and was welcomed by the maitre d who then informed me politely that there was no reservation in our name and that all the window tables were reserved. The only English name on the list was "Matthews" but there were no "Matthews" in our party. I rang my friend in England who'd organised the lunch but who was not able to attend. "But there must be a reservation!" she exclaimed. "The only English name on the list is 'Matthews'", I replied. "They must have made a mistake," she proclaimed. "Take the 'Matthews' table." I returned sheepishly to the maitre d and said that in fact 'Matthews' was my table. "Ah, you are a friend of Monsieur Matthews?" he asked. "Well, voila, Monsieur Matthews has just arrived: let me escort you to the table!" Cringing with embarrassment, I was then obliged to admit that I must have made a mistake and the m d gleefully invited me to sit at the furthest table from the window to wait for the other members of my party. Five minutes later, my friends Mr and Mrs Brooks arrived and I explained the predicament. They spoke to the m d and looked at the list. The reservation was discovered under the name of "Brouex".

Thursday, October 09, 2008

Creative accounting

The Government will initially have to borrow £25bn to buy preference shares in the banks and Mervyn King thinks £50bn is a more realistic figure. The Treasury is betting that this figure will not be counted as "public sector net borrowing" as it will be an off-balance sheet transaction. (Such public accounting definitions are determined by the Office of National Statistics). If it were considered to be public borrowing, the UK deficit would rise to over 6% of national income this year. The question is whether the Government has control over the banks when it lends them the money. The Treasury has said that it will have a say in the dividend policies and executive compensation practices of those banks whose preference shares it owns and will require them to support lending to small businesses and home buyers. If the ONS decides that these factors mean that the Government does have effective control over the banks, they must be classified in the national accounts as "public financial corporations" and their liabilities must be added to public sector net debt, meaning that GB's pledge to keep PSND at 40% of national income is blown out of the water.

Tuesday, October 07, 2008

Conservatives go nationalist

George Osborne said yesterday that banks should be forced to curb pay and bonuses as a quid pro quo for any taxpayer-funded recapitalisation. This is a disappointing knee-jerk reaction from the Shadow Chancellor. It's all very well for the Government to call the shots at Northern Rock or if they are the majority shareholder of any bank but until that happens, such emotional comments are unworthy of a Shadow Chancellor. It's a shame Cameron didn't have the courage to switch Osborne and Hague months ago.

Monday, October 06, 2008

Hobbesian equilibrium

"The life of man, solitary, poor, nasty, brutish and short" wrote Thomas Hobbes in The Leviathan. He imagines life without government, with every man out for himself. To escape this, he concludes, a social contract is necessary. He was a Royalist and at one point tutor to the future King Charles II and so his ideal society was one where the population lives beneath a sovereign authority to whom all individuals in that society cede their natural rights for the sake of protection.I am reminded of this today when the German government is the latest to provide a blanket guarantee for bank deposits. The theory is that such a guarantee will restore confidence in the banking system and protect individuals' hard-earned savings. What is needed, though, is that banks resume lending to each other and the US bail-out at least addresses this. European governments are effectively saying that they are prepared to print money to save voters' deposits which will not help Trichet's Euro-zone inflation target. The logical next step is to abandon inflation targets.

Thursday, October 02, 2008

Solar wind

"The wind bloweth where it listeth, and thou hearest the sound thereof, but canst not tell whence it cometh, and whither it goeth" is what I thought when I read this morning about the solar wind being weaker than at any time since accurate observations began in the 1950s. Scientists are divided about the impact of the solar wind (which is a stream of electrically charged particles) on the climate down here on Earth. Some say that a quieter sun causes a cooler earth and cite the suspension of the solar cycle between 1645-1715, known as the Maunder Minimum when there were very few sunspots and it was the coldest part of the past millennium on earth. Others say that this is the calm before the next solar storm which could cause considerable disruption. They cite the storm of August 1859 when the Northern Lights were visible as far south as the tropics and the world's nascent telegraph network was inactivated for several hours. Anyway, nobody's blaming it on the credit crunch, yet.

Wednesday, October 01, 2008

Northern property

Dresdner Kleinwort's construction analysts have been touring property agents and consultants in Birmingham, Manchester, Leeds and Sheffield. The six leading property agents in Leeds have sold 6 new apartments between them in the last two months. Barratt in Yorkshire is offering discounts of up to 43% on bulk buys of at least 5 units. In all four cities, agents spoke of massive over-supply of apartments; developers selling at virtually any price to shift their stock of flats; virtually all forthcoming new developments mothballed; signs of the biggest listed housebuilders descending into severe financial difficulties; residential sales staff numbers being cut by around two-thirds and a complete freezing up of the land market. Generally lenders were insisting on deposits of at least 25% for flats, with very vigorous valuation criteria.